International Investing: Australia - Going Global

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Oct.23

5:10 PM ET

Tuesday, 23 Oct 2007

International Investing: Australia

Topics:China | Economy (Global) | Australia | Australia & New Zealand

Companies:Macquarie Global Infrastructure Total Return Fund Inc. | Macquarie Infrastructure Company Trust | First Trust Global

Economic Overview: Australia has a strong Western-style economy. Consumer confidence is high, exports of raw materials and agricultural products are profitable, and the budget has been in surplus since 2002. Negative factors in recent years include strong import demand and drought, although the trade balance improved last year after a long period of deficit growth.

Trade with China continues to increase, and inflation remains low as economic reforms move forward.

What to Watch: For anyone following financial news, hardly a day goes by without some Macquarie entity cutting a deal. From infrastructure to investment banking, this Australian behemoth has helped put down-under on the map on Wall Street.

It's known as The Millionaire's factory, Masters of the Universe, The Money Machine.

And just six months after booking its first billion-dollar profit, Australia's largest investment bank - Macquarie - expects to turn in its first billion -dollar half year.

The bank's business model holds little similarity to other Wall Street giants like Merrill Lynch and Morgan Stanley, both of which are now betting big on infrastructure. But Macquarie's business model has come under fire for being too complex. It's shares fell 11 percent in August amid the credit crunch chaos.

CEO Alan Moss says the bank has "no material'' credit problems.

Australia

By The Numbers

	2000	2006
Population	19.2 million	20.5 million
Economy
GNI, Atlas method (current US$)	396.9 billion	738.5 billion
GNI per capita, Atlas method (current US$)	20,720.0	35,990.0
GDP (current US$)	399.7 billion	768.2 billion
GDP growth (annual %)	1.9	2.4
Inflation, GDP deflator (annual%)	4.8	3.8
Agriculture, value added (% of GDP)	4.0	N/A
Industry, value added (% of GDP)	26.1	N/A
Services, etc., value added (% of GDP)	70.0	N/A
Exports of goods and services (% of GDP)	22.4	N/A
Imports of goods and services (% of GDP)	22.3	N/A
Gross capital formation (% of GDP)	22.1	N/A
Revenue, excluding grants (% of GDP)	24.9	N/A
Cash surplus/deficit (% of GDP)	1.9	N/A
States and Markets
Time required to start a business (days)	N/A	2.0
Market capitalization of listed companies (% of GDP)	93.3	N/A
Military expenditure (% of GDP)	1.7	N/A
Fixed line and mobile phone subscribers (per 1,000 people)	987.4	N/A
Internet users (per 1,000 people)	344.6	N/A
High-technology exports (% of manufactured exports)	15.2	NA
Global Links
Merchandise trade (% of GDP)	33.9	34.2
Net barter terms of trade (2000 = 100)	100.0	145.5
Foreign direct investment, net inflows (BoP, current US$)	13.6 billion	N/A
Workers' remittances and compensation of employees, received (US$)	1.9 billion	3.1 billion